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					              IN THE SUPREME COURT FOR THE

                     STATE OF FLORIDA

                       Case No. SC02-152

                       KEVIN STEELE,

                          Petitioner,

                              vs.

                  SUSAN B. KINSEY and
             UNITED AUTOMOBILE INSURANCE
                      COMPANY,

                         Respondents.

______________________________________________________________
                             _____

           ON DISCRETIONARY REVIEW FROM THE
       DISTRICT COURT OF APPEAL, SECOND DISTRICT
        CASE NOS. 2D002-4295, 2D00-4384 and 2D01-533

______________________________________________________________
                             _____

    RESPONDENT UNITED AUTOMOBILE INSURANCE
      COMPANY’S ANSWER BRIEF ON THE MERITS

                                    HINDA KLEIN, ESQUIRE
                                    CONROY, SIMBERG, GANON,
                                    KREVANS & ABEL, P.A.
                                    3440 Hollywood Blvd.
                                    Second Floor
                                    Hollywood, Fla. 33021
                                    (305) 961-1400 (Dade)
(954) 940-4821 (Broward)
                                         TABLE OF CONTENTS
                                                                                                                 Page

Table of Citations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Issues Presented For Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

         UNITED AUTOMOBILE’S SUPPLEMENTARY PAYMENTS
         PROVISION, WHICH PROVIDES COVERAGE FOR “OTHER
         REASONABLE EXPENSES INCURRED AT OUR REQUEST”
         DOES NOT COVER PLAINTIFF’S ATTORNEYS’ FEES
         ASSESSED AGAINST THE INSURED DEFENDANT PURSUANT
         TO A DEMAND FOR JUDGMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Statement of the Case and Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Summary of the Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Argument         . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Certificate of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Certificate of Compliance with Font Requirement . . . . . . . . . . . . . . . . . . . . . . . . 24




                                                           i
                                     TABLE OF CITATIONS

Cases                                                                                                     Page

Coleman v. Florida Ins. Guar. Ass’n, Inc.
517 So. 2d 686 (Fla. 1988) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Deni Associates of Florida, Inc. v. State Farm Fire & Cas. Ins. Co.,
711 So. 2d 1135 (Fla. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Excelsior Ins. Co. v. Pomona Park Bar & Package Store,
369 So. 2d 938 (Fla. 1979) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Florida Patient’s Compensation Fund v. Moxley,
557 So. 2d 863 (Fla. 1990) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Florida Ins. Guar. Ass’n, Inc. v. Johnson,
654 So. 2d 239 (Fla. 4th DCA 1995) . . . . . . . . . . . . . . . . . . . . 6, 10, 11, 14, 15, 16

Kepple v. Aetna Cas. & Sur. Co.,
634 So. 2d 220 (Fla. 2d DCA 1994)               . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

O’Conner v. Safeco Ins. Co. v. North America,
352 So. 2d 1244 (Fla. 1st DCA 1977) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Perrine Food Retailers, Inc. v. Odyssey Re (London) Ltd.,
721 So. 2d 402 (Fla. 3rd DCA 1992) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Smith v. Sitomer,
550 So. 2d 461 (Fla. 1989) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

South Carolina Ins. Co. v. Heuer,
402 So. 2d 480 (Fla. 4th DCA 1981),
rev. denied, 412 So. 2d 465 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Sparks v. Barnes,
755 So. 2d 718 (Fla. 2d DCA 2000)               . . . . . . . . . . . . . . . . . . . . . . . 5, 8, 18, 19, 22

                                                     ii
Spiegel v. Williams,
545 So. 2d 1360 (Fla. 1989) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 16, 18, 19

State Farm Fire & Cas. Co. v. CTC Development Corp.,
720 So. 2d 1072 (Fla. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

State ex rel. Royal Insurance Co. v. Barrs,
87 Fla. 168, 99 So. 668 (1924) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

State Farm Fire and Cas. Co. v. Metropolitan Dade County,
639 So. 2d 63 (Fla. 3rd DCA 1994), rev. denied, 649 So. 2d 234                       . . . . . . . . . . . . 13

Steele v. Kinsey,
801 So. 2d 297, 299 (Fla. 2d DCA 2001) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Weldon v. All American Life Ins. Co.,
605 So. 2d 911 (Fla. 2d DCA 1992) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14



Statutes And Other Legal Authorities                                                                      Page

§ 768.79, Fla. Stat. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 7, 18, 20, 21

§ 768.56, Fla. Stat. (1981)        . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16, 17, 18

Fla. Const. Article V, Section 3(b)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10




                                                     iii
                                    PREFACE

      In this Brief, the Petitioner KEVIN M. STEELE will be referred to as

STEELE. The Respondent SUSAN B. KINSEY will be referred to as KINSEY.

The Respondent UNITED AUTOMOBILE INSURANCE COMPANY will be

referred to as UNITED AUTO. The following symbols will be used:

      (R ) -- Record on Appeal.




                                        -1-
           ISSUES PRESENTED FOR REVIEW

UNITED AUTOMOBILE’S SUPPLEMENTARY PAYMENTS
PROVISION, WHICH PROVIDES COVERAGE FOR
“OTHER REASONABLE EXPENSES INCURRED AT OUR
REQUEST”, DOES NOT COVER PLAINTIFF’S
ATTORNEYS’ FEES ASSESSED AGAINST THE INSURED
DEFENDANT PURSUANT TO A DEMAND FOR
JUDGMENT




                       -2-
                     STATEMENT OF THE CASE AND FACTS

      This appeal arises out of a post-judgment ruling by the trial court on the issue

of whether UNITED AUTOMOBILE INSURANCE COMPANY’S (UNITED

AUTO) insurance policy, which covered the underlying claim against UNITED

AUTO’S insured SUSAN B. KINSEY (KINSEY), also provided coverage for

attorneys’ fees assessed against KINSEY pursuant to the Plaintiff KEVIN M.

STEELE’S (STEELE) demand for judgment. (R.466-468)

      The underlying litigation between STEELE and KINSEY arose from an

automobile accident in which STEELE was injured. (R.1-4) During the litigation,

STEELE served KINSEY with a demand for judgment which was not accepted.

(R.8, 184)

      STEELE, KINSEY and UNITED AUTO entered into a “Cunningham

Stipulation”, whereby the parties agreed to stay further proceedings in the

underlying litigation while KINSEY, UNITED AUTO’S insured, filed a bad faith

suit against UNITED AUTO. 1 (R.146-152) The agreement provided that if it was

determined in that suit that UNITED AUTO did not act in bad faith relative to

STEELE’S claim against KINSEY, STEELE would accept the policy benefits

available to KINSEY and dismiss his case against her with prejudice. (R.149) If,

      1
          That bad faith action remains pending.

                                           -3-
on the other hand, the bad faith suit resulted in a judgment against UNITED AUTO,

the parties stipulated that STEELE would recover $125,000 plus attorneys’ fees

and costs incurred by STEELE in both the action against KINSEY (if same were

not payable under UNITED AUTO’S policy) as well as those fees and costs

incurred in the bad faith litigation. (R.149) Thereafter, STEELE would dismiss the

underlying action against KINSEY with prejudice. (R.149) The parties also agreed

to submit to the trial court the issue of whether STEELE’S attorneys’ fees would

be covered under the policy or whether those attorneys’ fees could only be

collected in the bad faith litigation. (R.146-152) This stipulation was approved by

the trial court. (R.153)

      STEELE filed his Motion to Determine Entitlement to Attorneys’ Fees and

Expenses Pursuant to Florida Statute 768.79. (R.182-193) The parties stipulated

on the amount of the attorneys’ fees that could be awarded pursuant to the demand

and deferred hearing on the issue of whether STEELE’S demand was in bad faith.

(R.414-415) The trial court heard only the issue of whether the attorneys’ fees

would be covered under UNITED AUTO’S insurance policy. (R.414-415)

      UNITED AUTO’S insurance policy provides coverage for “Supplementary

Payments” as follows:




                                          -4-
             In addition to our limit of liability, we will pay on behalf
             of a covered person:

                                           ...

             5. Other reasonable expenses incurred at our request.

(R.306)

      At the hearing, STEELE’S counsel argued that the phrase “other reasonable

expenses incurred at our request” was ambiguous and should be construed in favor

of coverage so as to provide coverage for STEELE’S attorneys’ fees. (R.433)

UNITED AUTO argued that the phrase was not ambiguous and that under no

circumstances could the phrase be construed to provide coverage for the

Plaintiff’s attorneys’ fees, which were never incurred at the insurer’s request.

(R.442-443) UNITED AUTO argued that there was no coverage for STEELE’S

fees under the policy and that, pursuant to this court’s Spiegal v. Williams, 545 So.

2d 1360 (Fla. 1989) and the Second District Court of Appeal’s ruling in Sparks v.

Barnes, 755 So. 2d 718 (Fla. 2d DCA 2000), STEELE’S attorneys’ fees would be

collectible from the insurer only in the event that KINSEY prevailed on her bad faith

claim. (R.445)

       At the conclusion of the hearing, the trial court asked both counsel to

provide further memoranda of law in support of their respective positions. (R.318-


                                           -5-
336, 337-353, 462-463) Thereafter, relying upon Spiegal, the trial court found that

UNITED AUTO’S policy did not provide coverage for STEELE’S attorneys’

fees. (R.354-357) The trial court entered an “Amended Final Declaratory Judgment

Determining Insurance Coverage” in favor of UNITED AUTO. (R.466-468) This

order was timely appealed by STEELE. (R.469-72)

       On appeal, the Second District affirmed the trial court’s judgment finding no

coverage and found that the policy language in question was not ambiguous and

certified that its finding conflicted with that of the Fourth District in Florida

Insurance Guaranty Ass’n v. Johnson, 654 So. 2d 239 (Fla. 4th DCA 1995). See,

Steele v. Kinsey, 801 So. 2d 297, 299 (Fla. 2d DCA 2001). In Johnson, the Fourth

District held that the identical policy language required the insurer to cover taxable

costs incurred by the plaintiff and assessed against the insured. Johnson, 654 So.

2d at 240. The Second District in this case disagreed, finding that “[t]he words at

issue here, ‘reasonable expenses incurred at our request,’ can only mean that the

insurer must request the product or service that incurs the expense.” Steele, 801

So. 2d at 300.

       The Petitioner timely filed his appeal to this court based on the Second

District’s certification.




                                             -6-
                            SUMMARY OF ARGUMENT

      The policy language requiring UNITED AUTO to pay “other reasonable

expenses incurred at our request” does not provide coverage for a plaintiff’s

attorneys’ fees assessed against its insured pursuant to a demand for judgment.

The clause in question does not specify that such fees are covered, nor is it

ambiguous in any way that would permit a court to construe the language to require

that the insurer pay the plaintiff’s fees. The failure to define a word or clause does

not, in and of itself, render the clause ambiguous; a clause is only ambiguous if

there are alternative reasonable interpretations. It is patently unreasonable to

construe the clause to require payment of the prosecution’s fees in addition to the

fees of defense counsel, since that is clearly not a risk assumed by an insurer when

it agrees to defend an insured. Since the clause is not ambiguous, it must be

enforced as written and since it does not require insurer’s to pay attorneys’ fee

awards, there is no coverage under the policy as written.

      This Court has issued several opinions addressing an insurer’s liability for

attorneys’ fees assessed against their insureds under prevailing party fee statutes

and has found that such clauses did not obligate the carrier to cover such fees,

unless they were assessed as costs. Like the statute at issue in those cases, Florida

Statute 768.79 does not specify that fees assessed will be taxed as costs and

                                           -7-
therefore, the insurer’s liability to pay costs assessed against an insured does not

extend to fees.

       Sparks v. Barnes, 755 So. 2d 718 (Fla. 2d DCA 2000) provides further

support for UNITED AUTO’S argument that there is no basis upon which to

assess fees against it. In Sparks, the Second District refused to permit a plaintiff to

add the insurer to a judgment for fees rendered against the insured. The Court

noted that the carrier was not a party to the litigation and absent a statutory or

contractual basis obligating the carrier to pay such fees, they could not be assessed

against the carrier, absent a finding of bad faith. While the court recognized the

apparent inequity of the situation where a carrier “calls the shots” in litigation but

does not have to pay an attorneys’ fees award, the Court also recognized that this

inequity could only be cured by the legislature, and not the courts.

       STEELE’S reliance from decisions from other jurisdictions is unavailing as

none of those decisions is remotely factually similar to the case at bar. In all of the

cases cited by STEELE, courts in other jurisdictions found that in first party cases

between the insured and his or her carrier, the insured was entitled to recover

attorneys’ fees expended in defending a coverage action brought by the carrier, as

the carrier’s litigation essentially forced the insured to pay expenses “at the carrier’s

request”. None of the cases relied upon by STEELE involved third-party claims for

                                            -8-
fees and none of those cases address the interrelationship between the

supplementary payments clause at issue and an offer of judgment statute.

      Finally, STEELE’S argument that the legislative intent behind the offer of

judgment statute should compel this Court to ignore both the language of the policy

as well as the express language of the statute is groundless. It is well-established

public policy in this State that attorneys’ fees may only be assessed based on

contractual or statutory grounds. Absent such grounds, the fees are simply not

recoverable under the policy.

      The Second District’s order should be approved.




                                           -9-
                                     ARGUMENT

      UNITED AUTOMOBILE’S SUPPLEMENTARY PAYMENTS
      PROVISION, WHICH PROVIDES COVERAGE FOR
      “OTHER REASONABLE EXPENSES INCURRED AT OUR
      REQUEST”, DOES NOT COVER PLAINTIFF’S
      ATTORNEYS’ FEES ASSESSED AGAINST THE INSURED
      DEFENDANT PURSUANT TO A DEMAND FOR
      JUDGMENT

                               A. Standard of Review

      STEELE correctly states that the standard of review from an order

construing an insurance policy as a matter of law is de novo. See, Coleman v.

Florida Ins. Guar. Ass’n, Inc. 517 So. 2d 686 (Fla. 1988).

              B. Notwithstanding the Second District’s certification,
              there is no “express and direct conflict” and this Court
                      has no jurisdiction to consider this case.

      This Court has not definitively accepted jurisdiction to consider this case and

we submit that, upon review, it should determine that there is no “express and

direct conflict” among the District Courts of Appeal establishing this court’s

jurisdiction. See, Fla. Const. Article V, Section 3(b)(3). The Second District’s

decision in this case addresses the issue of whether attorneys fees assessed against

an insured pursuant to an Offer of Judgment are covered under the Supplementary

Payments provision of UNITED AUTO’S policy. The Fourth District’s opinion in



                                          -10-
Florida Insurance Guaranty Ass’n v. Johnson, 654 So. 2d 239 (Fla. 4th DCA 1995)

does not address that same issue but instead, addresses the question of whether

costs assessed against an insured are covered under the same language of the

policy.

      Nowhere in Johnson does the Fourth District Court of Appeal hold that the

Supplementary Payments language common to both cases is ambiguous.

Therefore, the Second District’s finding in this case that the language is not

ambiguous is not in conflict with the Fourth District’s opinion. Moreover, since

Johnson involved the issue of coverage for costs and this case deals with the issue

of coverage for fees and there are different policy considerations underlying both

opinions, see infra, p.14-16, the decisions can readily be reconciled without this

court’s intervention. This Court should decline to accept jurisdiction in this case.

                    C. The Policy Language in question is not
                   ambiguous and, even if it is, it should not be
                   construed to provide coverage for STEELE’S
                                  attorneys’ fees

      STEELE contends that the language in question, “other reasonable expenses

incurred at our request” is ambiguous, and that, as a result, it should be construed

broadly to provide coverage for STEELE’S attorneys’ fees. STEELE contends

that UNITED AUTO’S failure to define “expenses incurred at our request” results


                                           -11-
in an ambiguity. However, as STEELE himself admits, the mere failure to define

terms in a policy does not render policy language ambiguous. Rather, the question

is whether the terms or phrases themselves are ambiguous such that a reasonable

person could not understand their meaning. We contend that they are not but even

if they are, as the Second District recognized, STEELE’S assertion that his

attorneys’ fees could be deemed to be “expenses incurred at [UNITED AUTO’S]

request” is not a reasonable interpretation of that language such that the Court

could or should find that the clause in question provides coverage for those fees,

even in the event that this Court finds that the clause is ambiguous.

      STEELE assumes that all he has to do is to convince this Court that the

clause in question is ambiguous and he wins. That is not the case. One seeking

coverage under allegedly ambiguous policy language has a two-fold burden: to

convince the court that the clause in question is ambiguous because there are

alternative reasonable interpretations of the same language and to convince the

Court that his or her interpretation is, in fact, reasonable. STEELE has failed to

meet either of his burdens here.

      STEELE argues that “expenses incurred at our request” is ambiguous

because it is not defined. However, it is axiomatic that not every word or phrase in

an insurance policy requires definition and the mere failure to provide definitions

                                          -12-
does not, in and of itself, render a word or phrase ambiguous. State Farm Fire &

Cas. Co. v. CTC Development Corp., 720 So. 2d 1072 (Fla. 1998). Rather,

ambiguity in an insurance policy arises where more than one reasonable

interpretation may fairly be given a particular policy provision. See, id. at 1076;

State Farm Fire and Cas. Co. v. Metropolitan Dade County, 639 So. 2d 63 (Fla. 3rd

DCA 1994), rev. denied, 649 So. 2d 234. STEELE’S alternative interpretation that

“expenses incurred at our request” could fairly be read to cover the Plaintiff’s

counsel’s fees expended in suing UNITED AUTO’S insured is simply not

reasonable, as such fees (assuming they are deemed “expenses”) were most

definitely not incurred at the carrier’s “request”, nor would they have been under

any circumstance.

      Courts review policy provisions in light of the character of the risks assumed

by an insurer. South Carolina Ins. Co. v. Heuer, 402 So. 2d 480 (Fla. 4th DCA

1981), rev. denied, 412 So. 2d 465, O’Conner v. Safeco Ins. Co. v. North

America, 352 So. 2d 1244 (Fla. 1st DCA 1977). If viewed in this light, STEELE’S

contention that the clause in question covers his fees makes no sense because,

while carriers assume the risk of having to defend the insured and the contract

requires the carrier to pay all expenses associated with that defense, there is nothing

in the contract or within the realm of common sense that indicates that a carrier also

                                           -13-
assumes the risk of paying for the prosecution of a claim against the insured.

Such an analysis would result in an absurd result, contrary to principles of policy

construction. See, Deni Associates of Florida, Inc. v. State Farm Fire & Cas. Ins.

Co., 711 So. 2d 1135 (Fla. 1998)(insurance policies will not be construed so as to

reach an absurd result). Since STEELE has failed to provide this Court with an

alternative reasonable construction of the language in question, he has not

demonstrated the requisite ambiguity necessary to compel this Court to go beyond

the plain language of the clause. Cf, Weldon v. All American Life Ins. Co., 605 So.

2d 911 (Fla. 2d DCA 1992)(when terms make contract subject to different

reasonable interpretations, one of coverage and one of exclusion ambiguity exists).

Where no ambiguity exists, courts may not go beyond the plain language of a

clause and must give effect to the policy as written. Perrine Food Retailers, Inc. v.

Odyssey Re (London) Ltd., 721 So. 2d 402 (Fla. 3rd DCA 1992).

       Tellingly, although the clause in question is a common one, STEELE has not

been able to find a single case, in this or any other state, holding that the clause is

ambiguous. In fact, as we argued, supra pp 10-11, the Fourth District in Johnson

did not find that the clause was ambiguous in its opinion construing the phrase as

applied to taxable costs, although that was clearly one of the issues on appeal.

Rather, the appellate court simply applied the clause as written and determined that

                                            -14-
the term “expenses” included taxable costs and that such costs were “incurred at

[the insurer’s] request” by virtue of the carrier’s failure to settle.2 We disagree with

STEELE that the Johnson court implicitly determined that the supplementary

payments provision was ambiguous, simply because it found that the carrier was

liable for taxable costs under that provision. The Court simply applied the clause

as written, finding that the term “expenses” necessarily included costs and that an

insurance carrier impliedly requests that such costs be incurred when it unilaterally

decides to litigate a claim.

       We believe that the Johnson court was simply wrong in construing the

unambiguous language of this clause in a manner that simply makes no sense.

Neither the plaintiff’s costs nor attorneys’ fees could been deemed to have been

“incurred” at the insurer’s request. The fact that the Johnson court did not find the

clause ambiguous but construed it in a manner that was, at best, strained and at

worst, nonsensical, illustrates that the decision was rendered without regard to the

foregoing well-established principles of policy construction, which prohibits a court

from rewriting a policy to add meaning that is not present or to reach results

contrary to the intentions of the parties. See, Excelsior Ins. Co. v. Pomona Park


       2
       UNITED AUTO did not dispute its liability for taxable costs under the
Supplementary Payments provision, in light of the Johnson decision. (R.443-444)

                                           -15-
Bar & Package Store, 369 So. 2d 938 (Fla. 1979)(rule that ambiguities in contract

are to be construed in favor of insured apply only when there is a genuine ambiguity

and do not permit courts to rewrite contracts).

       In any event, even if the Johnson court was correct in construing the clause

to apply to apply to taxable costs, that decision is not dispositive of the issue in

this case which is whether the clause could be construed so as to require a carrier

to pay the plaintiff’s attorneys’ fees. This Court has already addressed this issue,

albeit in light of slightly different contract language, and found that the Plaintiff’s

attorneys’ fees, which were assessed against insureds under former statute 768.56

(which provided that the prevailing party in a malpractice suit was entitled to

recover attorneys’ fees from the losing party) were not covered under the

defendant’s insurance policies.

       In Florida Patient’s Compensation Fund v. Moxley, 557 So. 2d 863 (Fla.

1990), this Court found that a supplementary payments provision in the carrier’s

policy, which provided coverage for “all expenses incurred by the company [and]

all costs taxed against the named insured in any suit defended by the company” did

not provide coverage for attorneys’ fees, which were not taxed as costs. The court

relied on its prior decision in Spiegel v. Williams, 545 So. 2d 1360 (Fla. 1989), in

which it construed the clause requiring the insurer to pay “all costs of defending a

                                            -16-
suit, including interest on that part of any judgment that doesn’t exceed the limit of

your coverage.”    In finding that the attorneys’ fees assessed against the insured

were not covered as “costs of defending a suit”, Justice Grimes reasoned:

      We do not see how the statutory award of plaintiff’s attorneys’ fees
      can be construed to be a cost of defending a suit.

      While a policy could not doubt be written specifically to cover court-
      awarded attorneys’ fees, liability insurers are normally only responsible
      for the payment of the plaintiff’s attorneys’ fees where bad faith is
      involved or the insured prevails in a direct action against the company
      [citations omitted] On the other hand, liability insurers have usually
      been responsible for the payment of taxable costs over and above the
      policy limits. [citations omitted] Therefore, the result reached by the
      district court of appeal would be justified if the award of the plaintiff’s
      attorneys’ fees could be considered as a species of taxable costs.
      Yet, ever since this Court’s decision in State ex rel. Royal Insurance
      Co. v. Barrs, 87 Fla. 168, 99 So. 668 (1924), attorneys’ fees
      recoverable by statute are regarded as ‘costs’ only when specified as
      such by the statute which authorizes their recovery. [citations omitted]
      Indeed, there are some statutes which provide for an award of
      attorneys’ fees to be taxed as costs. [citation omitted] However,
      section 768.56, Florida Statutes (1981) did not specify that attorneys’
      fees could be taxed as costs.

Id. at 1362. This Court followed this decision with Smith v. Sitomer, 550 So. 2d

461 (Fla. 1989), in which the court found that a liability policy covering “all

expenses incurred by the Staff Fund, all costs taxed against the member in any suit

defended by the Staff fund and all interest on the entire amount of any judgment”

did not cover attorneys’ fees against the insured because the attorneys’ fees were


                                           -17-
not assessed as “costs”.

       This Court has consistently found, when construing Supplementary

Payments Provisions similar to the one at bar, that those provisions do not cover

attorneys’ fees assessed against an insured unless those fees were assessed as

costs. According to Spiegal, said fees are only assessed as costs if the statute

under which they are being assessed specifically provides that such fees shall be

taxed as costs. Like former statute 768.56, Florida Statute 768.79 does not so

provide. Since the Spiegal Court recognized that “liability insurers are normally

only responsible for the payment of the plaintiff’s attorneys’ fees where bad faith is

involved or the insured prevails in a direct action against the company,” there is

simply no authority for departing from the rule in this case.

            D. Sparks v. Barnes is persuasive authority for affirmance.

       Admittedly Sparks v. Barnes, 755 So. 2d 718 (Fla. 2d DCA 1999) is

somewhat distinguishable from this case but contrary to STEELE’S argument,, its

precepts hold true here. In Sparks, the Second District addressed this issue in the

context of whether the Plaintiff was entitled to recover his attorneys’ fees directly

from the insurer by adding the insurer to the judgment against the insured pursuant

to the non-joinder statute. In holding that the Plaintiff could not collect his

attorneys’ fees directly from the carrier, the Court found that the Plaintiff did not

                                           -18-
serve the carrier with his demand for judgment and since the carrier was not a party

to the litigation, it could not be held directly liable for payment of the Plaintiff’s

fees. The court noted, as did the Spiegal court, that in order to obtain attorneys’

fees directly from the carrier, Sparks could file a bad faith claim seeking such fees

as damages.

       As in Sparks, the offer of judgment in this case was never served on

UNITED AUTO, nor would it have been since the carrier was never a party in the

underlying litigation. STEELE can not make UNITED AUTO a party by arguing

that its control of the litigation rendered it responsible for his attorneys’ fees. On

that basis, Sparks is legally indistinguishable from this case and bound the trial

court to find that in order to pursue a claim for his attorneys’ fees against UNITED

AUTO, STEELE is required to pursue his bad faith remedies.

       STEELE’S argument that because UNITED AUTO controlled the litigation,

it should be bound to pay the consequences for rejecting an offer of judgment

within policy limits is undeniably appealing, but does not permit this or any other

court to rewrite a policy. The same argument was raised in the Supreme Court’s

medical malpractice cases and in Sparks. In fact, in his concurring opinion in

Sparks, Judge Whatley bemoaned the fact that the “playing field” was not entirely

level because an insurer could direct litigation without having to pay the

                                             -19-
consequences. Id. at 720-721. Judge Whatley recognized, as did the trial and

appellate courts in the instant case, that this issue is a matter for the legislature, and

not for the courts. The only way to remedy the situation would be to amend

Florida Statute 768.79 so as to permit collection of the Plaintiff’s attorneys’ fees

assessed under a demand for judgment directly against the carrier, as if the carrier

was the real party in interest, without regard to any limitations on the carrier’s

obligations under the policy. Until such time as the legislature has seen fit to amend

the statute, and unless the carrier’s policy clearly provides that such fees are

covered as supplementary payments, there is no authority in Florida which would

permit STEELE to recover his attorneys’ fees against UNITED AUTO absent a

determination of bad faith.

                   E. The decisions from other jurisdictions cited
                       by STEELE have no application here.

       STEELE’S reliance on cases from other jurisdictions finding the language in

question sufficient to establish a basis for fees in first-party claims brought by the

insured against the insurer have no application in this third-party litigation. First, it

is apparent that unlike Florida, those jurisdictions do not have statutes automatically

awarding attorneys’ fees to a prevailing insured in a first-party case and it therefore

appears that the courts dealing with the issue have determined, as a matter of public


                                            -20-
policy, that where the insurer acts in bad faith in wrongfully denying coverage to its

insured, the insurer, in essence, requests that the insured expend fees in obtaining

the coverage it paid for. Second, the cases relied upon by STEELE are cases in

which the carrier, and not the insured, initiated the litigation, thereby forcing the

insured to defend itself. These cases are completely distinguishable and not

binding or even persuasive on this court.

              E. Legislative Intent behind Florida Statute 768.79 does
            is irrelevant to the construction of UNITED AUTO’S policy.

       We agree with STEELE that the obvious intent behind the offer of judgment

statute is to encourage early settlement. We do, however, disagree that the policy

would not be served by this Court’s decision affirming the trial court’s judgment.

Insurers are well aware that when they determine not to accept a demand for

judgment, they are running the risk of being sued for bad faith if, at the conclusion

of the litigation, the plaintiff recovers an amount in excess of policy limits and/or

attorneys’ fees that are not recoverable under the policy. The insurers are also well

aware that if they are subject to bad faith litigation, they will ultimately pay far more

than the plaintiff’s attorneys’ fees at the trial court level. There are serious

consequences attached to an insurer’s decision not to accept a demand for

judgment and the insurer will ultimately pay those consequences, as there is no


                                            -21-
shortage of plaintiff’s attorneys eager to sue insurers on excess judgments.

STEELE’S suggestion that carriers walk away scot-free is nothing more than

groundless hyperbole.

       More importantly, STEELE has cited to no authority for his assumption that

it is the public policy of this State to make insurers pay a plaintiff’s attorneys’ fee

that they do not owe under statute or contract. Indeed, it would contravene the

well-entrenched policy to the contrary. As this Court observed in Sparks, “a fee

award is never justified absent a legal basis, contractual or statutory, to support it.”

Id. at 719. In making the argument that this Court should rely on some perceived,

but unexpressed, legislative intent, STEELE has impliedly admitted that neither the

statute nor any contract support his claim. The judgment on appeal must be

affirmed.




                                            -22-
                                  CONCLUSION

      For the foregoing reasons, the judgment on appeal must be affirmed in all

respects.



                                               CONROY, SIMBERG, GANON,
                                               KREVANS & ABEL, P.A.
                                               3440 Hollywood Blvd.
                                               Second Floor
                                               Hollywood, Fla. 33021
                                               (954) 961-1400 (Dade)
                                               (954) 940-4821 (Broward)


                                               By:_______________________
                                                    HINDA KLEIN
                                                    Florida Bar No. 510815




                                        -23-
                               CERTIFICATE OF SERVICE

       I CERTIFY that a copy of the foregoing has been furnished, by mail, this

15th day of May, 2001, to: Louis K. Rosenbloum, Esq., 4300 Bayou Boulevard,

Suite 36, Pensacola, Florida 32503; Dale Swope, Esquire, Swope Law Group, P.A.,

1234 E. 5th Avenue, Tampa, Florida 33605; Karen A. Barnett, Esquire, 201 E. Kennedy

Boulevard, Suite 1518 Tampa, FL 33602; Michael W. Lehrer, Esq., Luks, Koleos

& Santaniello, P.A., One Mack-Cali Center, 501 E. Kennedy Blvd., Tampa, Florida

33602; Sharon Lee Stedman, Esq., Sharon Lee Stedman, P.A., 1516 East Hillcrest Street,

Suite 108, Orlando, Florida 32803-4714; Jene P. Williams, Liggio, Benrubi & Williams,

P.A., Barristers Building, Suite 3-B, 1615 Forum Place, West Palm Beach, Fla. 33401;

Philip M. Burlington, Esq., Suite 3A/Barristers Bldg., 1615 Forum Place, West Palm

Beach, FL 33401.

        CERTIFICATE OF COMPLIANCE WITH FONT REQUIREMENT

       I certify that this brief was typed in 14-point Times New Roman font.

                                                      CONROY, SIMBERG, GANON,
                                                      KREVANS & ABEL, P.A.
                                                      3440 Hollywood Blvd., 2nd Floor
                                                      Hollywood, Fla. 33021
                                                      (954) 961-1400 (Dade)
                                                      (954) 940-4821 (Broward)

                                                      By:_______________________
                                                           HINDA KLEIN
                                                           Florida Bar No. 510815

                                               -24-

				
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